HARP Refinance Closing Case Studies
We just had another Home Affordable Refinance Program closing. This is a great product for underwater or upside down homeowners who have loans backed by Fannie Mae or Freddie Mac.
This borrower owed 105% of appraised value on the first mortgage and 166% combined loan to value total with the second mortgage.
We were able to lower the mortgage rate by 1.50% using this special HARP 2.0 refinance program. Our client was extremely happy they were able to get a lower mortgage payment even though they were upside down on their home loan.
The 2nd mortgage stayed in place and the borrower is free to get this payment reduced or work a discount with the 2nd mortgage holder down the road.
Most importantly he was able to lower his mortgage payments to an affordable level, keep excellent credit intact, and stay in his home and not have to move the kids to a different school.
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Underwater refinancing example case study <a href=”http://www.c-mortgage.com/harp-refinance/”>Underwater refinancing example case study</a>
Another example is an investment property where we lowered the rate by 2.25%. The borrower paid 310K and the current value is $175,000. This borrower owed 234K we were able do a relief refinance.
On this scenario the payment dropped from $1490 to $1120. This program will work wonders on any type of Fannie Mae or Freddie Mac backed mortgage. This borrower was able to save $370 per month. In most households this can make a real difference rewarding those who have stayed current on their upside down mortgages.
Hard Money Lenders Orlando
We are lending hard money now from Orlando north to Jacksonville in addition to the Tampa Bay Area. Call 800-287-8858!
Proof of down payment funds and our property inspection is all that needed for a quick closing on purchases. Free and clear properties just call with the property address and we will get you an approval the next day.
Home Loans For People With Bad Credit
In today’s market there are few types of home loans for people with bad credit.
- Hard Money Loan
- Manually Underwritten FHA Loan
- Reverse Mortgage Loan
Almost anyone with equity or a large down payment can qualify for a hard money loan. Properties that are free and clear can close really fast. In some cases where a seller is willing to assist with financing. Buyers with smaller down payments can even qualify when the seller is willing to do a seller hold back or seller second mortgage.
Hard money loans can be used to quickly access equity or close fast on a bargain purchase.
FHA loans with manual underwriting are tough to find and get, you’ll need to jump through a bunch of hoops and it will take 30-45 days to close typically. However they are the only loans that offer low interest mortgage rates for people with bad credit.
Reverse mortgage loans also known as a Home Equity Conversion Mortgage ( HECM ) have no credit qualifications. They are for senior homeowners age 62 and above who live in the home at lease six months out of the year. Reverse home loans can be used by seniors for any purpose and can even save a seniors home from foreclosure.
If you have any questions about bad credit mortgages please give us a call 813-874-5800
Hard Money: What To Look Out For
I just got off the phone with a borrower who owns several free and clear rental houses and he had some great questions about hard money loans. Usually borrowers just call and ask…
What is your interest rate?
How much are the points?
It would seem you could determine the cost of the loan from just these two questions, but you really need to dig a little deeper to calculate the true cost of a hard equity loan.
Here is another more important question you need to ask even before the other two.
What’s the term or length of the loan?
A lot of hard money loans are made for just a year or two. Even if you plan to sell or qualify for bank financing within the short-term. What happens if things don’t work out that way? What if you find a really good tenant who will stay for a long-term? You may change your mind about selling. You may need to get another short-term equity loan. What will the cost of two hard money loans be in a three to four-year period?
Planning for the worst and getting a longer term loan even if that longer term equity loan is a little more expensive may be a lot cheaper in the long run.
Some hard money lenders offer balloons for three , five, and even seven years. A few even offer fully amortizing loans for up to twenty years.
